Telemarketing`s Growth Puts Trouble On The Line

Telephone Sales Representative: . . . Have you received the literature we sent you about our accident and medical policies?

Target: Yes, but you really should know that I`m a retired policeman with full coverage. My wife works, and we`re also covered on her group policy.

TSR: I appreciate that, but this is supplemental coverage to pay for what your other policies don`t. Let me just take a minute to tell you some of the benefits . . .

Target: But you`re betting that I`m going into the hospital and I`m betting I`m not . . .

TSR: Did you know that, according to the National Safety Council, someone dies in an accident every six seconds?

Welcome to the complex, strange and sometimes controversial world of telemarketing.

On the complex side, telemarketing can be a highly technological business where computers scan demographic data to select likely sales targets, dial telephone numbers automatically and guide salesmen word-for-word through their pitches.

In the face of reluctant consumers, computers even supply the sales reps sitting in front of them with pre-scripted rebuttals to specific objections.

On the strange side, telemarketing is a business where ``neutral``

Midwestern accents are prized and where obscure holidays like ``National Can Opener Week`` are celebrated to help counter the heavy diet of rejection. It also is an industry that some feel owes a large part of its acceptance and growth to the Strategic Air Command and its craving for telecommunications equipment.

And on the controversial side, some of the industry`s more annoying practices are coming under increasing fire.

A number of state legislatures are considering measures to keep telemarketers from calling people who don`t want to be bothered, limit the hours in which households can be contacted, and ban the use of sequential dialers, among other proposed restrictions.

``Unfortunately,`` concedes one consultant in the field only half jokingly, ``most people still think the word telemarketing comes from the Greek `tele,` meaning `at a distance,` and the Latin `marketing,` meaning `to interrupt during dinner.` ``

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Although telemarketing is big and getting bigger, no one really knows how big, how fast it is growing or even if more calls are made trying to sell products and services to businesses or to individual consumers at home.

But one clue to the scope of its activities can be found in a widely quoted but very possibly inaccurate industry estimate that $42 billion was spent last year in the U.S. on telemarketing operations.

Given that selling by phone probably costs somewhere in the neighborhood of $30 an hour on the average, that translates into about 1.4 billion hours a year spent on the phone dialing for dollars.

At a reasonable average of, say, 8 completed calls an hour (including both ``outbound`` calls on the part of telephone sales reps or ``inbound`` on ``800`` numbers to operators ``standing by``), about 11 billion contacts presumably are being made by magazine sellers, furnace cleaners, aluminum siders, insurance salesmen, stock brokers, catalogue order-takers, newspaper- subscription solicitors (including employees of this one) and others. In the last few years, banks in particular have become major telemarketers in the wake of industry deregulation, even offering home equity loans over the phone. That comes to a staggering 47 ``completed`` calls to every man, woman and child in the United States. Considering further that it probably takes at least 2.5 calls on average to find someone at home or at the office--even just to have them hang up--something on the order of 30 billion telephone calls actually were dialed by telemarketers last year.

In all, probably 1.5 million people are employed in the industry, either as phone reps or supervisors, accounting for something on the order of $100 billion in sales, industry consultants estimate.

Most of the work is done by ``in-house`` staffs at various companies. Upwards of 100,000 businesses are believed to have at least a few internal taffers who work the phones. In addition, there are an estimated 300 to 500

``service bureaus`` spread over the country whose sole business is telemarketing for outside clients. Included among these are operations belonging to American Airlines, AT&T, American Express, Control Data and Dun & Bradstreet.

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Hello. This is Zsa Zsa Gabor. When I became a member of the Montgomery Ward Auto Club, it really was a special occasion. Not often does Zsa Zsa do anything that half a million people have done before her. (Chuckle)

This personal phone message is special, too. It means I can invite you to join . . .

The above is an example of a computerized telemarketing message, one used eight years ago in a brief, failed trial by Montgomery Ward`s Signature Group, which lays claim to the title of the world`s biggest ``outbound``